Giant will open 3 more Heirloom Markets this year

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Dive Brief:

Less than two weeks after opening its first Giant Heirloom Market in Philadelphia, Giant Food Stores says it will open three additional locations in the city this year, according to a company press release.

The second Heirloom Market store will open this summer in the University City neighborhood between Drexel University and the University of Pennsylvania. The third location is slated to open in Northern Liberties in the fall while the fourth will open in the Queen Village neighborhood by year's end.

Each location will feature an assortment of local offerings, fresh foods and meal solutions, and the University City location will offer payment through DragonCard and Penn Card, the student ID payment systems for Drexel and the University of Pennsylvania.

Dive Insight:

Well that was fast.

Just twelve days after opening its first Heirloom Market, Giant says it's ready to roll out three more specialty stores. The locations were likely queued up by the company before the first location opened in the Graduate Hospital neighborhood, but the speed of the announcement indicates a strong reception and a momentum Giant wants to continue to build.

Many of Heirloom Market's features come from the grab bag of specialty features retailers are putting into their stores these days. There's a produce butcher (or "produce chef" as Giant calls the position), kombucha on tap, a make-your-own olive oil stand and a large selection of craft beer and local brands. Nature's Promise, the Stop & Shop natural and organic brand that Ahold Delhaize has scaled to other banners, features prominently, as do plant-based selections, including an entire freezer section.

There are also some unique touches, including European-style open layout and department labeling. The produce section is called the "Garden," while meat and seafood is "Land and Sea." The store is also exclusively self-checkout, with the familiar front-end kiosks, as well as mobile payment through the Scan It! app.

The key to success for any store is striking the right combination of location, assortment, service and marketing. In the lead-up to the opening of its first location, Giant talked up the fact that it surveyed local shoppers and crafted the store around their preferences. Paul Madarieta, Giant's director of growth initiatives who knows a thing or two about urban retailing from years spent with Trader Joe's, said many of the young, affluent shoppers in the area wanted a sensory experience.

"We're in the food business, but we sometimes forget that people want to taste and smell — and have all the senses chiming away when it comes to food," he told the Philly Voice.

Giant has talked up Heirloom Market as a Philadelphia institution in the making. And if it hits, the company will want to take the concept to other cities. The opportunity in densely populated metro markets is great, but also littered with failures. At just 9,500 square feet, Heirloom Market can fit into many a tight space.

But can it generate steady customer traffic? And would Giant and parent company Ahold Delhaize keep the Heirloom Market name or come up with customized specialty brands for various cities? This is a strategy Meijer is employing with its scaled-down grocery stores.

Ahold Delhaize is eager to hit urban grocery pay dirt, particularly after its Bfresh stores failed to take off. The company seems to be off to a strong start with Heirloom Market, but the months ahead will determine if the concept truly resonates with shoppers.